Author(s)

Ran Feng, Wanling Chen

Corresponding Author

Ran Feng

ABSTRACT

The fast development of e-commerce with the obviously decline of the traditional business not only leads to the hot discussion of e-commerce, but also to the thinking and exploration of the logical mechanism of e-commerce development. Therefore, this paper will demonstrate the relationship between e-commerce and traditional physical business based on the retailing. First, the T correlation analysis method is using to confirm that China’s e-commerce has the negative effect to traditional physical business, ones of developed countries such as the US and Australia has positive effect. Second, the regional difference caused by the supervision system was found by application of new institutional economics. At last, the suggests was given that we should enhance the implementation of e-commerce supervision system and establishing e-commerce taxation system, which aims to change the substitution effect of China’s e-commerce and create a ‘harmonious co-existence’ between e-commerce and traditional physical business.

KEYWORDS

E-commerce, physical business, on-line retailing, off-line retailing